Michigan Cuts off Lotto Winner’s Food Stamps

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Do you ever play the lottery? If so, you might find yourself imagining what life would be like if you won the jackpot. Maybe you dream about traveling, buying a new house, putting your kids through school or donating money to charity. You may even hope that the money goes to someone who really needs it – like someone on food stamps. It probably doesn’t cross your mind that a food stamp recipient would continue to collect benefits, even after her lucky number came up. According to a recent article published in the Chicago Tribune, that’s exactly what happened in Michigan – and now it has her in hot water with the state.

The story is pretty straightforward? the Michigan woman was receiving $200 per month in Supplemental Nutrition Assistance Program (SNAP) benefits; she won the lottery last September; she didn’t notify the state that her ”wealth status” had changed and she continued to collect benefits. She also bought a new house and a new car. (Fraudsters love new cars.)

Her case garnered media attention at the same time legislators were undertaking measures to ”limit taxpayer-funded benefits to people who are eligible or to eliminate them for people who have had the good luck to move on.’? The initial legislation was ”sparked by a similar case in which a man who won $2 million in the lottery in 2010 kept receiving benefits until last spring.’? (Maybe we should all be playing the lottery in Michigan.)

The state has since cut off her benefits and now ”her case has been turned over to state anti-fraud officials” for investigation. And Michigan hasn’t stopped there. Bills are pending in the legislature that would require the Michigan Lottery to tell the Department of Human Services (DHS) about its lottery winners, better enabling the state to verify an applicant’s eligibility. The DHS director backs the idea, and has said? ”’We fully support this proposed change. Our office of inspector general will continue to vigorously pursue any and all abuse and fraud in the welfare system.”’

Michigan is clearly committed to cracking down on fraud. So, here’s the question for the day? does your state have access to the data it needs to find fraud in benefit programs?

Source: Today’s ”Fraud of the Day” is based on an article entitled, ”Michigan cuts off food aid for $1-million lottery winner,” by Michael Muskal of the Los Angeles Times, published by the Chicago Tribune on March 8, 2012.

Beware of too much good luck, warns a classic Greek myth – a lesson that a Michigan woman who won a $1-million state lottery jackpot has learned the hard way.

Michigan’s Department of Human Services has cut off $200 a month in food aid to Amanda Clayton in the wake of media reports that she had won $1 million in the state lottery in September. To make matters worse for Clayton, who lives in Lincoln Park near Detroit, her case has been turned over to state anti-fraud officials.

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Larry Benson
Larry Benson is currently the Director of Strategic Alliances for Revenue Discovery and Recovery at LexisNexis Risk Solutions. In this role, Benson is responsible for developing partnerships for the tax and revenue and child support enforcement verticals. He focuses on embedded companies that have a need for third-party analytics to enhance their current offerings.